Pop quiz: How many new nuclear generation plants are under active development in the US today? If you answered "just one", take a bow. But even that one may never come on line...
Recent Nuclear Energy Development in the U.S.
In late July 2017, South Carolina Electric & Gas and Santee Cooper announced plans to abandon further development on the expansion of the V.C. Summer Nuclear Station in Jenkinsville, SC. Originally started in 2008, the project has seen massive cost overruns, schedule delays and the bankruptcy of Westinghouse, the supplier of the AP1000 reactors for the project.
Following that decision, the only remaining active nuclear energy development project in the U.S. is the Alvin W. Vogtle generating station near Augusta, GA. Like the V.C. Summer project, the Vogtle project uses the same AP1000 reactor design. And it too has experienced cost overruns and delays. Unlike the V.C. Summer project, cost overruns can be spread over a larger base of customers: 2.4 million for the Vogtle project versus 700,000 for the V.C. Summer project.
Vogtle is far from a certainty
The Vogtle project must clear a number of hurdles before it comes online, and the primary developer, Southern Co, has made it clear that failure of any of the following could jeopardize the project:
- The Senate must approve extending the deadline for production tax credits in a bill called HR.1551. This is crucial, since the projected completion date for Vogtle has slipped past the original Dec. 31, 2020 deadline.
- Toshiba, who acquired Westinghouse's assets, must make good on its promise to pitch in $3.7B to the project.
- The DOE continues to extend loan guarantees for the project, which is not a certainty.
- The other partners to the project (Oglethorpe Power, the Municipal Electric Authority of Georgia and the city of Dalton GA) are willing to pass project cost increases through their customers
Finally, it should be noted that the Georgia Public Services Commission has yet to review and approve Southern Co.'s proposal, which won't complete until mid February 2018. And already, there is growing opposition to continuing the project.
What does the future hold for Nuclear?
It's easy to see why Southern Co. wants to continue development of Vogtle: when completed, it's a major asset that Southern Co. owns and controls. Unlike natural gas plants whose costs vary with gas prices and may be subject to C02 policies, a nuclear plant generates guaranteed rate of return for the 30-50 year lifetime of the plant.
And everyone agrees that decarbonization of the grid is crucial. And yet...
Many people, myself included, believe that in the 10 to 19 years it takes to design, license and construct a new nuclear plant that solar and wind plus storage will become a functionally equivalent and more economical source of carbon-free power.
Rather than make this blog entry too long, I recommend reading this article by Seb Henbest of Bloomberg New Energy Finance: Energy to 2040 – Faster Shift to Clean, Dynamic, Distributed -- Henbest lays out the argument the Solar + Wind is rapidly approaching two tipping points: the first when solar or wind is cheaper than building new coal or gas plants, and the second where it's cheaper to stop running coal and gas plants altogether.
The punch line? Henbest doesn't once mention nuclear as an economically viable source of new energy in the future.
I welcome your views on the future of Nuclear Energy in the U.S. and elsewhere.